Roundup: Litigation

Over the past few weeks, there has been significant news in the world of litigation. The Halliburton case has given corporate defendants more leverage to fight back class action lawsuits while the NFL has settled a case to remove a previous compensatory cap on damages for concussion-related issues for former players. Other news includes the unanimous Supreme Court decision to require warrants for searching smartphones and the controversial Hobby Lobby decision and its implications on Obamacare. Finally, Facebook is under scrutiny for its experimental data collection. Click through the slideshow to learn more.

On July 7, Judge Brody agreed to an NFL proposal to remove the previous settlement’s cap on damages. Originally, the National Football League settled a class action lawsuit over concussion-related issues for $675 million in compensatory claims in August 2013. Now, the settlement is expected to cover former players who experience neurological problems as a result of play, and the settlement will last for at least 65 years. “A class action settlement that offers prompt relief is superior to the likely alternative -- years of expensive, difficult, and uncertain litigation, with no assurance of recovery, while retired players' physical and mental conditions continue to deteriorate,” said Judge Brody in approving the altered settlement.

Halliburton decision could be more impactful than it appears

On Monday June 23, the Supreme Court released its decision in Halliburton v. Erica P. John Fund. While the Court did not toss out the fraud-on-the-market precedent credited to the Basic v. Levinson case of 1988, it has given corporate defendants leverage to fight back when they’re on the receiving end of a shareholder class action lawsuit. The Supreme Court decided that the fraud-on-the-market presumption would be upheld, however its decision now gives defendants of shareholder suits an opportunity to prove that any misleading infromation they released did not impact stock prices, which could eliminate the portion of a class unable to prove they relied on sais information. The news is not only a relief to companies that may have had to weigh their options in the wake of a big class action suit, but also another point in the Supreme Court’s trend towards heavier scrutiny to the assembly of classes targeting corporations.

The Burwell vs. Hobby Lobby Stores, Inc. case, which was narrowly decided by the U.S. Supreme Court, has led to a lot of controversy. Under the decision, many closely held corporations now do not have to pay for birth control of employees if offering it violates the owners’ religious beliefs. The decision relates to many closely held, for-profit businesses, which, prior to the ruling, likely would have been required under Obamacare to provide varied forms of contraception to employees. However, the Hobby Lobby decision does not impact the non-profit religious sector. Two years ago, a compromise was negotiated, so religious-based schools, religious hospitals and non-profits were able to avoid providing contraception coverage under Obamacare. Still, it is possible that the Hobby Lobby decision is just one piece of a continuing effort to dismantle Obamacare regulations.

A recent Facebook experiment— in which researchers manipulated the content found on user’s news feeds — is now under investigation from several European data agencies. The agencies wish to find whether Facebook broke data privacy laws with its January 2012 investigation. These investigations are largely a result of the public outcry against Facebook once the experiment’s data collection records came to light. Ireland’s Office of the Data Protection Commissioner has asked Facebook to turn over details about the study, including whether Facebook attempted to gain consent from its user base. For its part, Facebook seems prepared for regulator questions. Facebook’s director of policy in Europe, Richard Allan, said, “We want to do better in the future and are improving our process based on this feedback. The study was done with appropriate protections for people’s information, and we are happy to answer any questions regulators may have.”

Supreme Court will require warrants for searching smartphones

In a unanimous decision, the Supreme Court said that the amount of information potentially stored on a smartphone coupled with the access it could give into other aspects of a person’s life them constitutionally protected under the 4th Amendment. The Supreme Court agreed that the original notion of searching pockets could not have accounted for this possibility in only a few hundred years, but also agreed that access to information could offer some level of protection to officers making these street-level judgment calls. The Supreme Court has now said that it will require police officers obtain a warrant to search the smartphones. While it will not nullify the use of cellphone stored data as evidence wholesale, it will add another step, saving some small sliver of privacy for John Q. Public.